ICom Notes Class 12 Banking Noting, Renewal and Retirement of Bill of Exchange

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NOTING OF THE BILL

When the bill of exchange is dishonoured by the party, the holder of the bill has a legal right to take action against them. In this regard he prepares a type of Public Notice. It is known as Notery Public which is attached along with the bill and is again presented for repayment. Usually this entry of the bill is made on a separate attached with the bill. If the payment is not made i.e. refused again then the date of the presentation the reference of the register with his signature is entered in the notice. This is called Notice of the Bill.

PROTESTING OF THE BILL

Sometimes due to refusal of payment a certificate or document is issued by the notary public containing all the information about the dishonour. This document is known as protest of the bill. It contains

1. Attested copy of the bill.
2. Signature of Notery Public.
3. The name of the person whose bill was protested.
4. The date and amount of the protest.
5. The cause of the protest.
6. The reply of the drawee.
7. The reason of absence of the drawee and the accepted.
8. The reason for the non-payment of the bill.
9. The certificate stamp of the notery public.

Renewal and Retirement of a Bill of Exchange

Sometimes the drawee of the bill is unable to pay the bill on its agreed date or time. In such a situation the drawee can apply to issue a new bill subject to certain conditions after the agreement of the drawer. This issuance of a new bill for some new time is known as renewal of the bill. After the issuance of the bill the former is considered to be cancelled. But if the drawee again unables to pay the newly issued bill, the first bill with all its farmer conditions becomes payable and valid.

RETIREMENT OF THE BILL

Sometimes the drawee pays the bill before the agreed date enjoying the rebate which is provided to him for prepayment of the bill. This is known as retirement of the bill. The amount of the rebate depends upon the time left for payment and the amount for which the bill is drawn.